Wednesday, February 27, 2008

NAFTA destroyed auto in Ohio

by Joel Wendland

NAFTA has moved front-and-center in the race for the Democratic nomination, not because any one candidate moved it there, but because free trade policies have hollowed out Ohio's manufacturing industry. Workers have forced the issue back into the spotlight.

According to a brief report by the labor-backed Economic Policy Institute, Ohio has lost 200,000 manufacturing jobs since 2000.

EPI admits that since NAFTA was implemented about 15 years ago, the automotive trade, a sector crucial to the economies of states like Ohio and Michigan, between the US and Mexico has grown. But "the effects on Ohio and other industrial states have been overwhelmingly negative."

In auto parts, for instance, the U.S. had a $2.4 billion surplus with Mexico in 1993; by last year the deficit was $12 billion. The auto deficit in total, reports EPI, stood at about $31 billion 2007.

EPI doesn't really get into finger-pointing, which is fine. But a little more analysis would be helpful.

NAFTA eliminated trade barriers between Mexico and the US. This fact made it profitable for GM, for example, to close factories in Ohio and Michigan and other places and move production to Mexico.

In the process good union jobs with good benefits were killed here – with attendant ripple effects like a weakened tax base for stable communities and public services, growing unemployment problems, internal migration etc. – in favor of low-pay and weak labor rights in Mexico.

Only the labor movement and the UAW have stood in the way of a complete breakdown of unionized auto production in the US.

While right-wing xenophobes are quick to blame Mexico and Mexicans, the real culprits in this affair are the corporations and the profit system that puts profits before our communities and our needs. Additionally, politicians who side with corporate interests and fail working families are also culpable.

The NAFTA debate in Ohio is crucial because both Democrats (Clinton a little more recently than Obama) are promising to renegotiate NAFTA in order to stem the flow of jobs out of the economy.

By contrast, John McCain traveled to Ohio and told voters there that they should just get used to it and kiss good paying jobs good bye.

No more stark difference ever existed.


Anonymous said...

Joel's article is very accurate and very relevant, and should be posted as widely as possible.
NAFTA and all NAFTA-like agreements help large capitalists and hurt workers and, in the case of Mexico workers and farmers, producing what are "enterprise zones" in poor countries to produce goods to be consumed in rich countries, displacing many more workers in the poor countries than they employ as cheap labor, displacing absolute numbers of workers in the rich countries, and increasing profit margins at the expense of working peoples living standards.

Another consequence of course is displaced desperately poor people trying to get into the U.S. because there is no place for them in their national economy.

Since the Ohio primary is coming up, one should remember the important political point that NAFTA, in terms of legislation which he actively supported and get enacted, along with the viciously reactionary 'welfare reform' policy, where he joined rather than fight the Gingrich Republicans, were the two great "victories," besides his elections, that Bill Clinton won. Bill Clinton twisted arms, offered favors, and did everything he could to get NAFTA passed, dividing the Democratic party, which produced the overwhelming majority of the votes in Congress against the treaty, along with the AFL-CIO and the entire labor movement, which opposed NAFTA. Politically NAFTA was an important reason why the Republicans won their congressional majority and held Congress for the next twelve years. Clinton is no one to trust when it comes to any renegotion of the treaty in the interests of U.S. workers.
Norman Markowitz

libhom said...

NAFTA is hurting the majorities in Mexico, Canada, and the US. Only the wealthy and corporations benefit.